Three Crows Candlestick Pattern

The “Three Crows” or “Three Black Crows” pattern is a reversal pattern that is found at the end of an uptrend. It is obviously bearish, as it reverses the previous bullish momentum that we have seen in the market. It consist of three bearish candles in a row, and is essentially the exact opposite of the “Three Soldiers” pattern. With that being said, you want to see the third candlestick to be at least close to the same length of the second candle, as a shorter third candle might suggest that the sellers are starting to run out of conviction.

The three crows pattern

The three crows pattern

 

Once you break down below the bottom of the third candle, it shows that the bearish momentum continues, and that the sellers are firmly in control. By the time that happens, the market should then be getting more and more bearish by the moment. As you can see on the chart attached, once we broke down below the bottom of the third candle, you can see that the market dropped significantly. With that being said, you can see that this was an excellent selling opportunity as the market had certainly changed its focus and attitude. Obviously something happened to have the market selling, as the impulsive move shows a major shift in psychology.

Three Crows signal in action.

Three Crows signal in action.

 

Please keep in mind that the candles shouldn’t have in this pair should have much in the way of wicks on the bottom of the candles, as that would show a little bit of indecision. The fact that we closed towards the very bottom of the range for the candles suggests that the market is without a doubt made up its mind.

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